Financial Ratios

Current Cash Debt Coverage Ratio – Definition, Formula, and How to Calculate

Financial Ratios

Definition Current Cash Debt Coverage Ratio is categorized as a liquidity ratio that is used to measure the effectiveness with which cash is managed within the company. It basically is a metric that depicts the company’s relation to the operating cash flow that is received by the company over the respective period, along with the […]

Current Cash Debt Coverage Ratio – Definition, Formula, and How to Calculate Read More »

Equity Vs. Debt: What are the Main Difference (6 Pioints Included)

Equity, Finance, Financial Ratios

When it comes to the sources of financing, companies or businesses have two primary options. These are equity and debt. Both of these types of finance have their advantages or disadvantages. However, companies use a combination of both to reap the maximum possible benefits from them. That is why a company’s capital structure will include

Equity Vs. Debt: What are the Main Difference (6 Pioints Included) Read More »

Cost to Income Ratio: Meaning, Example, Formula, Calculation, and More

Financial Ratios

Definition: The cost-to-income ratio is one of the efficiency ratios used to gauge an organization’s efficiency. It is used to compare the operating expenses of a bank vis-à-vis its income. The lower the cost to income ratio, the better the company’s performance. The cost to income ratio is primarily used in determining the profitability of

Cost to Income Ratio: Meaning, Example, Formula, Calculation, and More Read More »

How to Improve Return on Capital Employed? 4 Points You Should Know

Return on capital employed

Return on capital: Return on capital or return on equity invested or capital employed is the percentage return on investment. The return is generated from the profit the business makes from its activities. This is the formula for calculation of return on capital employed: Return on Capital Employed is calculated by Earning Before Interest and

How to Improve Return on Capital Employed? 4 Points You Should Know Read More »

Importance and limitation of Profitability Ratios (All You Need to Know)

Profitability Ratios

Overview: Profitability ratios are a group of quantitative values that measure a company’s profitability against its revenue, cost of sales, equity, and balance sheet assets. It is a metric that measures a company’s ability to generate income from its operations over a specific period of time. A profitability ratio is a category falling under financial

Importance and limitation of Profitability Ratios (All You Need to Know) Read More »

How to Improve Assets Turnover Ratio? (5 Points You Should Know)

Assets Turnover Ratio

The asset turnover ratio is one of the necessary financial ratios that depicts how the company utilizes its asset to generate turnover or sales. The asset Turnover ratio compares the company’s net sales with the total assets. It measures per rupee investment in assets used to generate sales. Different versions of the ratio depending on

How to Improve Assets Turnover Ratio? (5 Points You Should Know) Read More »